Last week, young single homeowner Client finds there is no Benefit in the bank after signing on for JSA. Phones up, and is told that benefit has in fact been suspended as he has a Border, which he says he told them on the first signing on day after the lodger moved in. ( but that's a side issue for the minute).

By invitation he attends an IUC. He is told that he is only allowed to keep the first £5 of rental income. My little QB13 programme says a lot more than that - correct me if I'm wrong but I thought the rule was that, out of the rent being collected, they ignore to first £20, and take into account 50% of the rest....? As you can surmise, We don't get a lot of JCP.

Now he's also been told that if he agrees to a 30% penalty and repays the alledged overpayment then all will be forgiven....


PS - this chap is a border as opposed to a subtenant isn't he ............?

Rules are in Sch 7 of the JSA Regs (income other than earnings).

Para 20 is subtenants - contractual liability to pay for occupation. Disregard is £4, plus £15.45 (=£19.45) if the payment includes heating.

Para 21 is boarders (where it is "board and lodging accommodation") - disregard is the first £20 and half the balance.

"Board and lodging accommodation" means that the payments include at least some meals which have been cooked or prepared by some person other than the lodger, as well as accommodation.

So the question is does your cleint prepare/cook food for this person? If not the other person isn't a boarder but a subtenant.

Either way, the correct amount is likely to be more than £5 (which doesn't appear anywhere in the regs), unless the lodger has his own key meter for electricity in his room.